The euro/US dollar is declining as a Trump tax project to enhance inflation in the United States
- EUR/USD faces pressure above 1.0500 as it earns the US dollar amid a strong recovery in American bond returns.
- The Republican House of Representatives approved a 4.5 trillion dollar taxes on Tuesday.
- The German HICP investors are waiting for the first month of February and inflation data in the United States of America for January, scheduled for Friday.
EUR/USD continues to face the pressure pressure above the 1.0500 psychological level in the North American session on Wednesday. The main currency pair decreases due to the strong recovery in the US dollar (USD). The US dollar index (DXY), which tracks the value of Greenback for six main currencies, moves sharply to approximately 106.50 after a weak opening around the lowest level in 11 weeks at 106.10 earlier in the day.
Meanwhile, the joint currency is rising against their other peers where investors convert to the European Central Bank policy meeting (ECB), which will be held next week. The European Central Bank will certainly be taken to reduce the rate of deposit facilities by 25 basis points (BPS) to 2.5 %. Therefore, investors will pay close attention to taking the European Central Bank’s monetary policy. A large number of European Central Bank officials direct that the central bank must continue to reduce interest rates based on expectations that inflation will return sustainable to a goal of 2 %.
The negotiating wage rate data on the euro Q4, a major wage growth measure, has also strengthened Dovish Dovish. On Tuesday, the European Central Bank stated that the wage growth scale rose at a slower pace of 4.12 % compared to the increase of 5.43 % in the third quarter of the previous year.
However, European Central Bank’s board member Isabelle Shenabel criticizes Duofish’s bets because she believes that economic weakness in the eurozone “is not due to the high costs of excessive borrowing” but to “structural factors”. Her comment indicated that she does not support more policy relief. “It is no longer clear that the current 2.75 % rate still hinders the economy of the euro zone,” said Shenabel.
To move forward, investors will focus on German Flash data for consumer price data (HICP) for February, which will be published on Friday.
Daily Digest Market Movers: EUR/USD decreases where the Trump tax reduction bill occurs a green signal
- Euro/US dollar has decreased as investors supported the US dollar against the euro (EUR). The US dollar benefits from a strong recovery in American bond yields, which was sliding for about a month. The US Treasury’s revenue jumps for 10 years to nearly 4.33 % after publishing a new 13 -week low level at about 4.28 % earlier in the day.
- A green light to the United States (the United States), the 4.5 trillion dollar tax plan by the United States (United States), the taxpayer, forced the traders to throw government bonds, assuming that decreased taxes on individuals would accelerate their purchasing power. Such a scenario would push inflationary pressures and forcing the Federal Reserve (Fed) to maintain interest rates in the current range of 4.25 % -4.50 % for a longer period.
- For new signals about the current situation of inflation, investors are waiting for the personal expenses price index data (PCE) for January, which will be released on Friday. It is estimated that the basic inflation data of PCE-preferred inflation scale of the Federal Reserve, as it excludes flying food and energy-has slowed to 2.6 % on an annual basis of 2.8 % in December. Soft inherent inflation data will affect the market expectations that the Federal Reserve will remain in a “waiting” position for a longer period.
US dollar price today
The table below shows the percentage of change in the US dollar (USD) against the main currencies listed today. The US dollar was the strongest against the New Zealand dollar.
| US dollar | euro | GBP | JPY | CAD | Aud | Nzd | Chf | |
|---|---|---|---|---|---|---|---|---|
| US dollar | 0.24 % | 0.13 % | 0.40 % | 0.16 % | 0.42 % | 0.44 % | 0.32 % | |
| euro | -0.24 % | -0.10 % | 0.14 % | -08 % | 0.17 % | 0.19 % | 0.08 % | |
| GBP | -0.13 % | 0.10 % | 0.25 % | 0.03 % | 0.28 % | 0.31 % | 0.20 % | |
| JPY | -0.40 % | -0.14 % | -0.25 % | -0.23 % | 0.04 % | 0.04 % | -06 % | |
| CAD | -16 % | 0.08 % | -0.03 % | 0.23 % | 0.26 % | 0.27 % | 0.17 % | |
| Aud | -0.42 % | -0.17 % | -0.28 % | -04 % | -26 % | 0.02 % | -07 % | |
| Nzd | -0.44 % | -0.19 % | -0.31 % | -04 % | -0.27 % | -02 % | -0.10 % | |
| Chf | -0.32 % | -08 % | -0.20 % | 0.06 % | -0.17 % | 0.07 % | 0.10 % |
The heat map shows the percentage changes in the main currencies against each other. The basic currency is chosen from the left column, while the quotation currency is chosen from the top row. For example, if you choose the US dollar from the left column and move along the horizontal line to the Japanese yen, the percentage offered in the box will represent the USD (base)/JPY (quote).
Technical Analysis: EUR/USD faces pressure over 1.0500
Euro/US dollar remains in a narrow range of about 1.0500 on Wednesday. The SIA moving average lasts for 50 days (EMA) to support the main currency pair is around 1.0440.
The relative strength index fluctuates for 14 days (RSI) slightly less than 60.00. The bullish momentum will be activated if RSI (14) can maintain higher than this level.
Looking down, the February 10 level of 1.0285 will serve as the main support area of the husband. On the contrary, the highest level on December 6 of 1.0630 will be the main barrier of euro bulls.
